DO YOU HAVE THE RIGHT REVOCABLE LIVING TRUST PLAN?

In the world of living trusts, once size truly does not fit all. An estate plan for a young family should be completely different than an estate plan for those in the prime of their life, which incidentally, is totally different than an estate and elder law plan for seniors. For example, young families should seriously think about having a Guardian Angel Trust™ set up for their children, if the unthinkable occurs and both parents predecease their kids at a young age.

With a Guardian Angel Trust™ (“GATs”), parents can designate guardians, trustees and protectors for their kids. Having a “panel of advisors” makes sure that until your youngest child reaches a certain age (for example, 23), all trust assets are held for the common benefit of all children. That means that one of your kids may get “more,” but that's probably what you would've wanted (for instance, you'd likely pay a lot for one child to receive costly medical treatments, if they needed it) in certain circumstances. Also, with a GAT, your kids can still access trust assets for their well being as well as having the ability to receive an “advance” on their inheritance for certain reasons, such as a down payment on a home or help paying for a wedding. Finally, once your youngest child reaches the target age (23 in our example), the trust is split equally among all children. From there, parents designate yet another age - when the children are more mature - to receive the funds outright. Before the second designated age however, the trust morphs into an Asset Protection Trust, so that divorcing spouses, ex-business partners, a bankruptcy court as well as any and all other potential creditors or predators, cannot reach the assets in your GAT.

For people in the prime of their lives and their older children, excellent estate plans tend to focus less on kids protection planning and more on probate avoidance, asset protection, tax reduction strategies, and distributing your estate in a manner that reduces the potential for conflict among family members. Drafting such a plan, requires an attorney to conduct an in-depth analysis of personal family dynamics, so that he or she can tailor a very specific trust that addresses specific family concerns with laser precision. To do less, is the reason why so many trusts wind up in Trust Litigation after mom and dad are gone. In addition to California revocable living trusts, experienced estate planning attorneys help people in the prime of their lives set up very specific trusts, such as IRA Retirement Trusts that achieve truly amazing results, by providing their heirs with asset protection for a lifetime and ensuring that retirement plans continue to grow for decades to come. These types of planning techniques create unparalleled legacies for families.

Now, when it comes to seniors, experienced elder law attorneys understand that estate plans are (or should be) totally different. What's more, is that recently so many trust and tax laws have changed, which makes most estate plans of individuals over the age of 65, completely out of date. For instance, if you executed an estate plan before 2013, chances are, your estate plan needs a complete overhaul for Tax, Social Security, Medicare, Medicaid, and VA Pension Benefit's reasons. How could that be, you wonder? Well, for starters, death tax laws are much more liberal than in the past. That means that today many couples have an AB-type living trust plan (a living trust that divides into sub-trusts after the death of the first spouse) which needlessly causes extra administration as well as legal and accounting fees when one spouse passes away.

But even if couples (or a single individual) have a “simple” trust, that trust is most likely focused on the issues surrounding what happens when the Settlor (the person who set up the trust) dies or becomes incapacitated. Which incidentally, is probably a good start for persons under the age of 65. Still, while the question of what happens when I die is a crucial one to ask, the more important question seniors should be asking themselves is what happens if I live? In other words, how am I (and my loved ones) going to deal with the emotional, physical, and financial burdens of my aging and long term care needs?

These are the issues that elder law attorneys face every day. So what does a senior focused estate plan look like? Well, for starters, financial powers of attorney allow agents to maneuver an estate so that a person can qualify for government benefits such as Medi-Cal and/or VA Aid and Attendance Pension Benefits, where appropriate. Estate and elder law attorneys also focus on asset preservation trusts, that not only avoid probate and say who gets what after you are gone, but additionally help seniors continue to live in the environment and conditions that they want in their retirement years, while preserving assets for their loved ones later.

Here at Kaiden Elder Law Group, PC, we specialize in restructuring outdated estate plans. To make sure that your estate plan does what you need and want it to do, please do not hesitate to contact us for a consultation.

All materials on this website are made available by Randall F. Kaiden, Esq., for informational purposes only and should not be construed as legal advice. The transmission and receipt of information contained on this website does not form or constitute an attorney-client relationship. Also, pursuant to Rule 1-400(E) of the Board of Governors of the State Bar on Advertising and Solicitation, please be advised that the testimonials or endorsements here do not constitute a guarantee, warranty, or prediction regarding your matters outcome.

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